Apple launches assault on the living room

TV set top box and movie downloads accompany revamped iPods.

Apple at a company event in San Francisco has unveiled a new movie download service and a television set top box in an effort to expand its media empire to the living room.

The television connector box, codenamed "iTV", is scheduled for release in the first quarter of 2007. It will feature HDMI, traditional three-plug composite, and optical cable video outputs, and can connect to a computer via Ethernet or wirelessly through Wi-Fi.

"This is the missing piece," said Apple chief executive Steve Jobs, who went on to summarize Apple's new home-user strategy as iTunes in the den, the living room, the car, and the pocket.

"The big news is that Apple wants to be in every room in your home," said Michael Gartenberg, vice president and research analyst of Jupiter Research.

Delivering high-resolution video through a wireless connection, however, remains a daunting task, he cautioned.

"It sounds like they're taking ownership of the problem. If it doesn't work out they're going to have huge issues, but they do have a good track record for making this stuff work" said Gartenberg.

Jobs also unveiled the full-length movie download service that had been predicted by many analysts in recent weeks. The service, available through a newly-released iTunes version 7, will allow users to download full-length films in prices ranging from US$9.99 to 14.99. A European version is expected to launch sometime in 2007.

Music videos are will also be offered for $3.39 each and games such as Trtris and Texas Hold'em at $7.49.

The company will offer 75 films from Disney owned studios including Pixar and Miramax with plans to expand the library in the coming months.

"We have movies, and they're now playing on a computer near you and they're all playing on an iPod near you," said Jobs.

When first introduced, Apple's video downloads were primarily targetting the iPod's small screen. To accomodate larger screens, Apple increased the resolution of its video downloads from the current 320 by 280 pixels to 640 by 480, which is the resolution of a standard television. The increased resolution makes the movies better-suited for larger screens.

The new iTunes 7 also introduces features an enhanced navigation system that sorts music by source lists and allows users to view songs by the album's art, as well as a scroll-by album art window similar to Apple's Front Row navigation system.

Perhaps overshadowed by the other announcements was a revamped iPod line. Most notably, Jobs unveiled a new iPod Shuffle that is roughly a third the size of the previous model. It will be available in October.

A second generation of the iPod Nano introduces multi-colored cases and larger storage capacities of up to 8 Gb.

New and expanded drive based iPods were also unveiled. The full-sized iPods sport a brighter screen, larger capacity (30 and 80 GB), and have the ability to play games from the iTunes store at a fee of US$4.99 per download. All three iPod lines will feature new headphone models.

Pricing for the new 30GB model wiull be $380 and an the 80GB model will be $499. The new Shuffle is priced at $119 and the 2GB Nano $219, 4GB $299 and the 8GB $380.

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